In Search of Exchange 3.0

I thought readers of this blog may also be interested in my guest post for Ad Age, where I give a brief history of the evolution of the display advertising exchange ecosystem and suggest what I believe is the next step.  This post for Ad Age follows up on my previous post here.

As always, let me know what you think!

Branding needs the web…and the web needs branding

Solid article on ClickZ last week with some insightful commentary from Nielsen Online CEO John Burbank.  Mr. Burbank correctly identifies lack of brand dollars online as the source of current downward pressure on rates and publisher revenue.  He’s 100% right that without these dollars following audiences online, the online publishing ecosystem will degrade and that users will not like the results.  This second theme was echoed by Omar Tawakol, CEO of BlueKai, in another insightful piece for AdAge.  So without a robust online ad market online, online publishing will suffer.  And if that ad market doesn’t include the large brands that funded quality content in other media, online content quality will degrade to the detriment of users, advertisers and publishers alike.  A tragedy of the commons of sorts.

Mr. Burbank went on to make the important point if publishers want to attract brand spend, they need to help brand advertisers measure results using metrics that are appropriate to the objectives of brand campaigns.  He suggests that rather than focusing on clicks, brands should be focused on “whether their ads reach the desired targets, change the way consumers think about their brands, or help sell products.”  Couldn’t have said it better myself.  This is something we discuss with our clients every day.  We actually partner with Nielsen to help our clients in CPG measure the extent to which their online campaigns sell product offline.  The results speak for themselves.  Online advertising works.

I do disagree with Mr. Burbank on one important point, however.   He seems to suggest that ad networks are responsible for the current challenges online publishers face.  It’s true that ad networks can put downward pressure on CPMs for a publisher, but that is primarily driven not by the fact that a network is doing the selling, but that the vast majority of networks sell almost exclusively to DR buyers.  Those buyers are extremely price sensitive and thus the downward pressure.  If there was a healthy level of demand by brand advertisers for online content, this downward pressure would be balanced and the online publishing ecosystem would be much more stable.  Unfortunately, online branding today remains too inefficient for brand dollars to follow audiences online easily and balance this equation.  So an ad network focused on branding, such as Brand.net, actually helps matters, increasing efficiency for brand buyers to help move budgets from other media, while not undermining the economics of the premium publishing model.  This is another topic near and dear to my heart, which I addressed at some length in an iMedia post earlier this year.

P&G’s “Passion for Digital”

P&G is the largest marketer in the world.They are also one of the most successful. This recent article in Ad Age gives us some insights into why.

The article quotes Marc Pritchard, P&G’s global CMO:

“I’ve got a lot of passion for digital. It really is such an incredible way to connect with consumers and really have much deeper ongoing relationships with them… Our media strategy is pretty simple: Follow the consumer. And the consumer is becoming more and more engaged in the digital world.”

It’s that last part that’s most insightful for me. Keep it simple, follow the consumer. This is very good advice, as it seems too often marketers can get so focused on the dizzying array of niche products and capabilities online that they lose sight of what they are really trying to accomplish, which is exactly that: reach consumers. Lots of them. In the right environments and with the right messages. This is something near and dear to our hearts at Brand.net, because when done well it drives strong, measurable results.

The discussion of online spend ramping to the point that marketing mix models can begin routinely reading it is also an important one for 2 reasons.  First because the 5% threshold they mention for an MMM read can represent a real inflection point for online spend for the CPG category – an extremely important category for the long-term health of the online ad ecosystem.  Secondly, the discussion highlights that fact that marketers want to think of online as a medium in line with other media at their disposal.  Online media is often sold as “special” or “different”, but the path to higher spend isn’t in forcing marketers to learn and embrace new technologies and metrics.  Nor is it in driving marketers into niche strategies like BT or custom executions that are flashy, but have negligible reach and impact.  Increasing online spend will undoubtedly involve new technology and learning on both the buy-side and the sell-side, but to focus on technology for technology’s sake is to miss the point.  The path to long-term, significant, sustainable increases in digital spend will be paved in large part by helping marketers leverage the skills and tools they already have to better follow the consumer – a consumer who is becoming more and more engaged in the digital world.

Thoughts re: Today’s WSJ article on Yahoo!’s APT

Jessica Vascellaro’s WSJ article this morning on Yahoo!’s display ad platform, APT, caught my attention. The problem Yahoo! is trying to solve with APT – (quoting Jessica) “that it remains a big pain today for advertisers to buy display ads across multiple sites and for publishers who have lots of online advertising space to sell to find demand for it” – is exactly the problem we founded Brand.net to solve. Continue reading “Thoughts re: Today’s WSJ article on Yahoo!’s APT”

David Moore, Chairman of WPP’s 24/7 (Now B3), Says Content Quality Doesn’t Matter

I was catching up on content from last week’s Ad Age digital conference when I came across this clip.  Turner Executive Walker Jacobs begins by exploring some common themes with respect to tension between top publishers and networks, but the part that really caught my attention is the short exchange at the very end of the clip between prominent market analyst Henry Blodget and David Moore, Chairman of ad network 24/7 (now renamed B3 within WPP):

Moore: “It wouldn’t hurt us at all if every premium site out there never used us again.  We’d be fine.  We don’t need ‘em.”
Blodget: “So, to heck with quality content.”
Moore: “Quality, really, is in the eye of the beholder.”

I had to rewind the clip and watch a few times to make sure I understood what Mr. Moore was saying.  I was, frankly, a little shocked to hear that from a senior executive at  WPP, parent company of some of the premier agencies in online advertising, who represent many of the most iconic brand marketers on the planet –  AT&T, Unilever, Sprint, Macy’s, Campbell’s Soup and  Colgate Palmolive among them.   I’ve had the privilege to work with each of those brands in my past life with Greg Coleman and Wenda Millard at Yahoo!, and have worked again with many of them in my new life at Brand.net.   Throughout that decade of experience, these brands have consistently reinforced the critical importance of both the quality of execution and the quality of the content surrounding their ads.  In short, the eyes of these beholders have insisted on very high content quality standards.

Because of this, we only buy from top quality sites.  If every premium site out there never used us again, it would not be possible for us to meet our clients’ standards for top quality ad environments.   However, the way the web is evolving makes maintaining quality an ever more difficult challenge.  The common practice of intermingling professional edit and UGC on the same page means that even if we start with the best sites, there are some individual pages that can create problems (most often due to user comments).  This is why we assembled a top notch technical team that in partnership with IBM has delivered a market-leading page-level filtering capability we call SafeScreenSafeScreen allows us to deliver the best of the best to our clients, which is what they look to us to provide.  Starting with top quality sites and continuing to lead the market with page-level filtering capability, we take our commitment to quality seriously and we always will.  It’s who we are.  And it’s what top advertisers told us at Yahoo! and tell us at Brand.net they are looking for from a partner.

So, a word to our premium site partners:  we *do* need you, we *will* need you, and we will continue to work with you on issues that matter to both of us,  including the need to constructively avoid channel conflict.  I am tired of glorified link farms supported by belly fat ads.  Let’s bring quality advertisers to quality content and watch the web thrive.

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